DEVELOPMENT PLANNING

Plans are intentions or set suggestions aimed at achieving certain set goals in future?

Development planning

➢ Refers to the deliberate effort by the state aimed at achieving certain set goals

➢ Is the preparation of the development plan and other supporting policies

➢ Studies which form the basis for making decision on planning applications
3) Goals/Aims of development plan
➢ Giving better services to the people

➢ Elimination of disparities between urban and rural areas

➢ Rising the standard of living of the people through increased income

Returns
Purpose/factors/characteristics of a good development plan
A statement of general objectives of economy and social policy
An evaluation of progress achieved under the preceding plan.
➢ Current economic conditions especially national income, productive and foreign trade

➢ Current social situation especially population changes, education, health housing and
social security

➢ Estimates of the growth, or social component during the period covered by the plan.

➢ Measures designed to raise the rate of economic growth for example:- to stimulate saving
and investment and to increase productivity which are impossible to achieve.

➢ To move towards a sustainable growth

Levels of planning

a) Individual Planning

➢ An individual has to draw a plan and a budget for a particular activity.

➢ Identification of resources to be used in the individual project

➢ An individual plan of action should have specific time frame, estimated income
and expenditure on the project

b) Community Level

➢ A group of people identifies resources to be used in a particular project.

➢ Then they draw a plan and a budget for the project which should show sources
of funds c) National Level

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 ➢ Government will draw a plan and budget

➢ Government may decide to build bridges across the country, schools and
hospitals.

➢ The government will advertise the project through tender to invite individuals or
companies to carry out projects.

d) International level

➢ This takes place at place international.

➢ For example, the United Nations Organization has set up international

development targets known as Sustainable Development Goals (SDGs) to be achieved by
individual states by 2030

B. Discuss types of development planning

1. Short Term Plan

➢ This covers a short period from (6) six months to (12) one year. It is sometimes referred to as the
Annual National Plan. The Annual Plan is the control plan which checks different ministries to make
sure that what was planned and budgeted for has been implemented.

➢ The major challenge about short term plan is under estimation.

2. Medium Term Plan

➢ It ranges between (3) three and (7) several years with (5) five years as the most popular choice.
➢ The purpose of medium Term Plan is to move towards self-sustaining growth, growth, for
example:- after independence Zambia had the Emergence

➢ National Development Plan which was designed to move the country from colonial Mono-
Economy to diversified economy.

The main objectives of the Medium Term Plan may be:-

➢ Diversify the economy to eliminate over dependence on one or two products

➢ Increase the value of the Nations own input
➢ Maintain reasonable price stability
➢ Eliminate disparities between urban and rural population in interns of wealth and job
opportunities

➢ Raise the level of general education

➢ Provide training to equip more people for administrative and technical jobs

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 ➢ Develop the necessary social infrastructure such as schools hospitals and roads
➢ Develop transport and communications
➢ Attain self-sufficiency in food supply and security and new sources energy
➢ Balance development between manufacturing industry and Agriculture
➢ Stabilize the economy by controlling inflation
➢ Periodically review the exchange and interest rate.
3. Long Term Plan

This is sometimes referred to as the Long Range Development Plan. It covers a period of (10) ten to
(20) twenty years and above. The Plan is mostly needed for implementation of huge projects

Reforestation

➢ Opening new mines.

➢ construction of hydro station

➢ Construction of new roads and railway lines such projects. It also enables government to spread
development to all areas particularly in rural areas.

➢ A long term plan takes care of the shortcoming of short and medium term plan such as planning
for too many things in one budget

C. Describe methods of planning

1) Centralized planning

➢ This is the kind of planning done by the central government without the involvement of the local
community.

➢ It is one where the control of the plan is centralised at one place.

➢ In the past centralized planning and administration were considered necessary to guide and control
the economics of countries

➢ is an economy where decisions on what to produce, how to and for whom are taken by central
government,

➢ This type of planning was common in communist countries. Zambia used this type of planning in
the first and second Republics.

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 ➢ lack of participation of the local community in the formulation and implementation of
the plan. It was argued that plans were being imposed in top-down fashion on local
communities which showed little enthusiasm at the crucial implementation stage.

➢ Centralised planning tended to disregard local condition. For example, centrally based
planners might decide on the need to grow wrong types of crops in particular areas which
are not suitable.

➢ Plan organisations were dominated by expatriate advisers who knew very little about
local farming communities.

➢ Locally based government officials were by-passed in plan preparation, including local
communities.

➢ There was delay of the approval of the plans since they were referred to the
headquarters before implementation

2) Decentralized Planning

➢ This type of planning is done by involving the local community.

➢ A local community identifies projects to be under taken at community level by taking into
consideration its actual needs.

➢ For example: - Schools, hospitals, bridges, piped water and housing units.

➢ The community may draw a budget for it to be submitted to the central Government for funding
The Zambian government tried this type of planning in the 1980s but there was less success.
➢ Much of the resources were spent on workers than on development projects.

➢ Since the year 2000, Decentralized planning has been re- introduced in Zambia through Activity
Based Budgeting Plans in the community.

➢ However, in 2023 Zambia re-launched the National Decentralization Policy which has devolved
more powers to Local Communities such as Civil Servants Recruitment and Constituency
Development Funds (CDF)

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 Comparisons between Centralized and Decentralized Planning

Centralized planning Decentralized planning

1.Top down planning 1.Bottom up planning

2. Planning done by Central government 2. Planning done by Local Government

3. Planning lacks responsiveness as little is known about local 3. Planning is responsive as more known about the local
community community

4. Lack of local community participation in formulating 4. Local community participation in formulating community
community development plans development plans

5. Lack of local community participation in implementing 5. Local community participation in implementing community
community development plans development plans

6. Delays in making decisions on local community needs 6. Quicker in making decisions on local community needs

7. Lack of priorities on local community needs 7. High priorities on local community needs

8. Lack of local community development 8. High local community development

9. Poor standards of living for local people 9. High standards of living for local people

10. Promotes dependence syndrome on central government 10. Promotes self-sustainability in local communities
by local community

a) The importance of budgeting in development planning

1) Budget

➢ is an estimate of income and expenditure. It is the balance between government‟s income

and expenditure

➢ is a plan of action for a specific period of time indicating estimated income and
expenditure on the project.

➢ The budget plays an important role in determining the performance of the economy.
➢ In Zambia the constitution mandates the Minister of Finance and National Planning to
present the budget for approval to the national assembly.

➢ This must be done under three months (90) days of each financial year.

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 ➢ The budget is presented every October and implemented in January the following year 2)
Medium Term Expenditure Framework (MTEF)
➢ This is a three year frame work within which available resources are divided between
sectors on the basis of achieving government objectives.

➢ MTEF allows for the budgeting preparation process to commence early.

➢ The MTEF was introduced as a measure to address weaknesses in the budgeting and
planning process.

3) National Budget process

➢ All issues which are to form part of the budget require Cabinet approval.
➢ The Cabinet meets more than once to chart the course of the budget.
➢ The first cabinet meeting is held between the third and fourth quarters of the financial year.
➢ The Next meeting takes place after the budget has been completed.
➢ The meeting ensures that all observations made during the first meeting have been incorporated on
the resources side.

➢ Stage 1: Drafting of national budget

➢ This is the first stage in national budget process
➢ Ministry of Finance will make a first draft a national budget on the Green paper by compiling all
requirements received from various government ministries and other departments.

➢ The first drafted national budget on Green paper is consolidated and forwarded to cabinet for
approval after which the green paper is printed for circulation.

➢ Stage 2: Cabinet approval of national budget draft

➢ Cabinet will then receive the first draft national budget to scrutinize it before sending it for public
discussion

➢ Cabinet will set national budget ceilings before sending it to all line ministries, provincial and
spending agencies together with the time table for discussion.

Stage 3: Public discussion on cabinet approved national budget draft

➢ All line ministries, provincial and spending agencies will receive the approved first national
budget from Cabinet with ceilings as they engage in national budget discussions

➢ This enables different sectors to contribute or make suggestions for inclusion in the first draft of
national budget

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Stage 4: Cabinet approval of national budget draft amendments

➢ Cabinet will receive suggestions for inclusion in the first draft of national budget from the national
budget discussions in stage 3

➢ Cabinet will consolidate the submissions received from budget discussions in stage 3 before
sending it to Ministry of Finance to finalize it and put it on Yellow paper.

➢ Stage 5: Parliament approval of national budget draft

➢ At this stage, the second draft of national budget is consolidated on Yellow paper and presented
by the Minister of Finance and National Planning to Parliament for approval.

➢ The National Budget us usually presented in parliament in the last 3 months (90 days ) specifically
in October and continued to be debated and approved before 31st December

➢ The approved national budget is then put on White paper

➢ After the budget has been presented for approval by the National assembly, two bills are prepared
and presented in the national assembly.

➢ The Bills are the Supplementary Appropriation Bill and Excess Expenditure Appropriation
Bill.

➢ These are aimed at normalizing measures contained in the budget.

➢ After the Appropriation Bill is passed into an act, the General Warrant is prepared for the
president to sign.

➢ The General Warrant gives authority to the Secretary to the Treasury to release funds for all
Programs.

➢ The General Warrant replaces the Provincial Warrant.(PW)

➢ Stage 6: National Budget Execution/Implementation
➢ The new approved national budget on White paper is always implemented in January of the new
year

➢ The Ministry Finance and National Planning will go ahead and inform ministries, Provinces and
spending agencies (MPSAs) on quarterly releases of funds allocated in the budget.

➢ Stage 7: National Budget monitoring

➢ Monitoring and evaluation of the budget is the responsibility of all the key players who should
administer and evaluate the use of public funds.

o Controlling officers (heads of government department)

o Accountant General- analyses the expenditure returns by ministry,
province and spending agencies

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 o The Monitoring and the Evaluation unit at the Ministry of Finance

Stage 8: National Budget

Evaluation/Audit Auditing of the
national budget is done by:
Internal auditors in all Ministries and Departments o Accountant Generals Office in all
Ministries o Auditor General- audits the public funds on yearly basis
Parliamentary Accounts Committee (PAC)
4) Importance of budgeting

1. It helps nation to give priority to basic needs such as food, health and education
2. It helps nation to save money for future use
3. It is a control measure to mean it helps a nation to cut down on wastages and make best
use of the money available.

4. It promotes transparency in the handling of money in a nation as the budget will be there
to been by anyone.

5. It helps people to accountable as all they have raised and spent will be clearly written
down.

6. It promotes equity in the sharing of resources more especially in a family and nation as
all need areas will be given a fair share of the money.

7. It helps to mobilize resources for capital expenditure

8. It helps to introduce taxation measures
9. It helps government to service debt promptly
10. It helps government to promptly fund the key economical areas
b) The importance of fiscal discipline in development planning

a) Fiscal Discipline
➢ Means strict control of public resources

➢ Is part of governance of overall economic policy aimed at achieving the government

economic objectives

➢ Government uses taxation, public and budget surplus or deficit to measure fiscal disciple
in use of resources

b) Importance of fiscal discipline

1. Reeducation of government expenditure in unproductive areas

2. Stops government borrowing from banks

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 3. Provision of more credit facilities to private sector

4. Avoids unfounded supplementary expenditure

5. Avoids adjustment of government spending to accommodate inflation

6. Leads to economic growth

7. Lowers interest rates in banks to encourage savings

8. Retrains wage increases to cut down on government expenditure on wage bills

9. Restrain price increase to keep inflation low

10. It maintains a realistic exchange rate

11. It encourages transparency and accountability

12. It encourages competition in the economy

1) Micro financial institutions

➢ Micro- Is a Greek word meaning “small ’’

➢ A Micro Financial institution is one that gives financial assistance to small scale
producers or entrepreneurs for small scale projects. For example:- farming, repair of a classroom
blocks and improving water supply.

Example of micro finance institutions

➢ Zambia Social Investment Fund (ZAMSIF)

➢ Women Finance Cooperative of Zambia

➢ Bay Port Finance Service

➢ Unity Finance

➢ Blue Financial services

➢ Izwe loans

➢ Microfin
Functions of micro financial institutions

1. Advise customers on small investments

2. Facilitate the withdraw on money to small scale customers
3. Extend small loans to small scale customers
4. Facilitates salary advances to customers
5. Helps small scale customers to save money
6. Gives overdraft facilities to small scale business men
2) Macro- financial institutions

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 ➢ Macro- is a Greek word meaning “large”.

➢ Macro Financial institutions are institutions which fund large scale projects such as
construction of schools, bridges, roads and railway line.

a) International Monetary Fund (IMF)

➢ The IMF is a specialized agency of the United Nations
Organization which was set up in 1944.

➢ Some of the Objectives of the fund are to:- o Promote

international Monetary Cooperation.

o Promote stable exchange rates and maintain orderly exchange arrangements o

Facilitate the expansion and balanced growth of international trade. o Encourage full
convertibility between currencies and can end to exchange rates controls o To shorten
periods of balance of payments of member countries

o However, the economic adjustments policies prescribed by the IMF are

considered by many to hinder development.
The measures suggested by the IMF to overcome the balance of payments
Problems include:-

➢ Relaxing exchange controls

➢ Removal of import restrictions, price controls and the end of subsidies

➢ Removal of controls over foreign exchange and imports in order to get assistance.

➢ The IMF‟s main financial role is to provide temporary credits to members experiencing
balance payments‟ difficulties.

b) International Bank for Reconstruction and Development (IBRD)

➢ The IBRD is commonly known as the World Bank. It began its operations in 1946.

➢ The Bank encourages capital investment for all member states.

➢ It gives loans to specific projects that are productive and provides Finance for foreign
exchange requirements for such projects Loans are usually for a period of 20 years with grace
period of five years.

c) African Development Bank (ADB)

➢ The ADB was established in August 1963 and began its operations in July 1966.

➢ It gives concessionary loans to member states.

➢ Concessionary Loan is money given to a country with no conditions attached.

➢ It gives Loans to specific project that are productive and provides finance for foreign
exchange requirements for such projects. The loans given are paid back with a low interest rate
less than 10%

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 ➢ The Bank also gives grants to member states to finance essential projects in education
and health. The headquarters of ADB is in Addis Ababa, Ethiopia.

d) Arab Bank for Economic Development in Africa (ABEDA)

➢ The Bank was set up by the Arab League in 1973 and begun operat5ions in 1975.

➢ The Head Office is in Khartoum, Sudan. It gives loans to specific projects that are
productive and provide finance for foreign exchange.

➢ Generally, Projects are financed jointly with international lending institutions such as the
World Bank and African Development Bank. Zambia obtained loans from ABEDA for capital
projects such as road construction.

F. Examine indicators of development

Indicators of development are signs that show whether or not there is improvement in the country’s

economy and people’s basic needs such as food, safe and clean drinking water housing education and
health.

➢ These are measurable variables which are assumed directly related to development such as:-

1. Gross National Product (GNP) or The National Income

➢ This is measure of production in monetary terms during period of time.

➢ It is the amount of goods and services produced within and outside the country in
particular year
➢ It also includes income from abroad.
2. Gross Domestic Product (GDP)

➢ Is the total output of an economy and consists of all accounted for goods and services that
have been produced in the course of the year within the country.

➢ All products and services produced within the country are added up calculated in
monetary form.

3. Human Development Index (HDI)

➢ This is the measure of human development using four

➢ Life expectancy at birth

➢ Adult literacy

➢ Average years of schooling

➢ Purchasing power of persons aged 25 and above expressed in dollars

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 ➢ If the country has a life expectancy at birth, a high adult literacy levels and a high average
years of schooling and purchasing power per person. It is said to have a high level of development

4. Per Capita Income

➢ It is the GNP of the country divided by the total population.

➢ This does not take into account income distribution disparities

➢ Per Capital Income = GNP

Total population

G. Outline Zambia’s national development plans from independence to present

1) The Emergency Development Plan (EDP)

It was launched immediately after independence. The aims
were; To restructure the inherited colonial capitalist
economy.
➢ Designed to lay a viable administrative structure
➢ Provide a framework for more comprehensive programmes of economic and social development
in Zambia.

2) The National Transitional Development Plan (NTDP) This plan covered the period from 1965 to1966.
The aims were:
➢ Extend transport and communication services
➢ Improvement of agriculture and education services (Primary schools and Secondary were built in
each district

3) The First National Development Plan (FNDP) It covered the period from 1966 to 1970. The aims were:
➢ Diversify the economy from mining to agriculture and manufacturing
➢ Develop rural areas
➢ Expand education services
➢ Expand welfare societies
➢ Improve transport and communication
➢ Create 100,000 jobs by 1970

4) The Second National Development Plan (SNDP)

This covered the period from 1972 to 1976. The aims were:

➢ Attaining self-sufficient food supplies and improvement of income

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 ➢ Expanding and diversifying industry and mining through import substitution by using local
materials.

➢ Initiating measures for regional development

➢ Linking educational programmes to the country‟s manpower requirements etc.

➢ Improve the existing infrastructure such as power, transport and communication

5) Third National Development Plan (TNDP) 1980 – 1983 It had the following provisions:-
➢ Allocating investment funds and creating a base for the transformation of society through
socialism and Humanism
➢ Involving the private sector in economic and social development while taking into account
Socialist and Humanist ideas.
➢ Balanced development with regard to linkages between industry and agriculture
➢ Increasing the production of consumer and capital goods
➢ Fair income distribution and creating and egalitarian (Communal Society)
➢ Diversification of the economy and rural development
➢ Expanding education training facilities to speed up Zambianasation.
6) Fourth Development Plan (FNDP) 1989- 1993
This plan was followed by the New Economic Recovery Program, (July 1987 to December 1993) The
FNDP focused on:-
➢ Periodic review of the exchange rate and interest rates
➢ The reduction of budget deficit to below 2% of Gross Domestic Product (GDP) by 1993
➢ A gradual reduction of subsidies so as to reduce pressure on the budget.
➢ Reduction in the annual growth of money supply to below 40% by 1993
➢ Reduction in the rate of inflation to below 20% in 1993
➢ Increase capacity utilization to above 70% of industrial averages by 1993
➢ Reducing the number of price controlled items to one by 1993

7) Transitional National Development Plan (TNDP)

In 2002 the government re introduced the National Development Plans it was expected to run from 2002 to 2005.
The major aim was to reduce poverty and debt burden. To do this a Poverty Strategy Paper (PRSP) was introduced.
Poverty Reduction Paper (PRSP) 2002 to 2005. The programme was started by International Monetary Fund
(IMF) The concentration was:

➢ Cross cutting issues

➢ Education

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 ➢ Healthy
➢ Agricultural
➢ Macro-economic issues
However the programme or development plan could not cover security sectors such as:

➢ Police and defence

8) Vision 2030
This is a long term plan aimed at making Zambia a prosperous middle income nation by 2030. To do this, the
government is to

➢ Be gender responsive
➢ Respect for human rights
➢ Have good traditional and family values
➢ Be peaceful
➢ Be public partners
Some of the Aspirations of Vision 2030 are

➢ Well maintained and developed infrastructure

➢ Technological proficiency
➢ Strong entrepreneur skills
➢ A conclusive macro-economic environment for growth
➢ Diversified education curricular
9) Fifth National Development Plan (FNDP)
The Fifth National Development Plan was based on the Vision 2030. It focuses on broad based wealth and job
creation through citizen participation. It covers the period from 2006 – 2010. Some of its aims are:

➢ Develop and rehabilitate infrastructure

➢ Develop human resource and capacity building
➢ Promote rural electrification
➢ Promote investment
➢ Promote accountability and transparency
➢ Develop small scale and large scale mining
➢ Develop and promote flexible and inclusive education programmes to take care of Children with
Special Needs (CSEN), School Health Nutrition (SHN), Orphaned and Vulnerable Children (OVC)
and HIV and AIDS

➢ Establish the E-Government ICT Application, etc.

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10) Sixth National Development Plan (SNDP)
The SNDP covers a period between 2011-2015. It aimed at building on the gains of the FNDP in the process of
attaining the Vision 2030. The theme of the Sixth National Development Plan was, "sustained economic growth
and poverty reduction". The objectives of the SNDP were accelerating:

➢ Infrastructure development

➢ Economic growth and diversification

➢ Rural investment and poverty reduction

➢ Enhance human development

Following the objectives above, the plan aimed at addressing the challenges of realising broad based propoor
growth, employment creation and human development.

11) The Seventh National Development Plan (7NDP)

The plan covers the period 2017 - 2021. Its theme was, “Accelerating development efforts towards the vision
2030 without leaving anyone behind”. The 7NDP was a vehicle to fulfil the United Nations Sustainable
Development Goals (SDGs) which is a universal call to end poverty, protect the planet and ensure that all people
enjoy peace and prosperity. It was also a tool for actualisation of Smart Zambia by making use of ICT for
development. The following are objectives of the 7NDP:

➢ Recognizing the impact of climate change on development and its threat to human kind
➢ Promoting the adoption of agricultural environmental-friendly practice
➢ Building new capital city, more roads and plant 500,000 hectares of trees across the country
➢ Recapitalising various industries e g Mulungushi textiles and Kawambwa tea company
➢ Promoting cultural transformation
➢ Utilisation of natural resources
➢ Fostering good neighbourliness and nurturing extended families
➢ Addressing issues of moral decay

12) The Eighth National Development Plan (8NDP)

The Eighth National Development Plan (8NDP) covers the period between 2022-2026. The theme for
8NDP is, “Social economic transformation for livelihoods”. The main aim of this plan is to improve the
efficiency and competiveness of the economy to sustainability and lifts the living standards of people. The
objectives or goals of this plan are to achieve:

➢ Economic transformation
➢ Job creation

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 ➢ Human rights and social development
➢ Environmental sustainability
➢ Good governance environment
The plan is further designed to unlock the country's immense prospects of all the sectors of the economy for
sustainability, holistic and inclusive national development with the aim of retuning to vision 2030, that is
becoming prosperous middle income nation.

TRUST THE PROCESS

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